Duration: 10/01/2021 to 09/30/2026

Administrative Advisor(s):

NIFA Reps:

Non-Technical Summary

Statement of Issues and Justification

How does the project serve stakeholders?

This project serves a diverse range of stakeholders including policymakers engaged in the design and implementation of public policy related to agricultural research and development (R&D) and the adoption and utilization of new agricultural technologies, as well as others who are affected by new agricultural technologies, from farmers and others engaged in the value chains of U.S. agriculture through to American consumers and those who advocate for environmental quality and conservation. Ultimately, every American is a stakeholder in this project.

Agricultural R&D and innovation is essential in several dimensions. It is central to maintaining access to food at reasonable costs in the face of increasing demand, by increasing yields and thus the productivity of our limited land and water resources. R&D and innovation increase product quality and the value-added of agriculture. Innovation reduces the risks and increases the resilience of agriculture in the face of pandemic human, plant, and animal diseases, wildfires, weather events, and trade disruptions.

This project serves its stakeholders by conducting studies of agricultural innovation systems and by developing models and measures of the economic consequences of past and prospective changes in the technologies used on farms and the role of public policy in facilitating those changes. These studies enable the stakeholders in U.S. agriculture to better understand how agricultural R&D contributes to the development and diffusion of new technologies that will help American farmers adapt to changes in their decision-making environments. Understanding and adapting to new technologies is a cross-cutting issue because of the diversity of factors that farmers and other stakeholders in U.S. agriculture face.

Various initiatives at the state, regional, and national level have emphasized the importance of research, extension, and technology transfer in helping farmers adapt to diverse changes they are facing. In this context, stakeholder groups have called for social science research to address various issues related to the economics of agricultural R&D and innovation. These issues can be divided into four broad, yet closely interrelated, areas related to agricultural R&D, innovation, and technology, each with a number of pressing questions:

1. Understanding how R&D, innovation, and new technologies facilitate adaptive responses to change in markets, policies, and the physical environment:
   • How does agricultural R&D and innovation respond to the ever-changing climate, pest, disease, food safety, and biosecurity challenges characterized by the emergence of adaptive dynamics?
   • How does agricultural R&D and innovation respond to global challenges, such as climate change or pandemics? When and how do private incentives arise for innovation to meet these very public challenges? What is and what should be the role of international public institutions (e.g. CGIAR) in addressing these challenges?
   • How does agricultural R&D and innovation respond to evolving public perceptions of different of farming technologies and production systems? What is the role of government in regulating those technologies and production systems relative to evolving public perceptions?
   • How does agricultural R&D and innovation respond to the emergence of new technological opportunities—such as those created by genome editing, precision data collection, or artificial intelligence and machine learning?
   • How does U.S. agricultural R&D respond to increasing competition from China, India, and Brazil and the increasing size and sophistication of their agricultural R&D and production capacities?
   • How does agricultural R&D respond to the introduction of new products that substitute for traditional product categories (such as margarine and vegetable shortening in early 20^thcentury, or dairy and meat substitutes today)?
2. Understanding the research and development (R&D) institutions and processes that contribute to innovations in food and agriculture:
   • Who is doing R&D and innovation for agriculture and why? What are the returns to R&D? Who is financing R&D? How is the structure of R&D changing, and why?
   • What are the roles of intellectual property and regulations in incentivizing, constraining, and otherwise shaping both public and privately funded R&D?
   • How does technology transfer affect the performance of the innovation supply chain, connecting research labs with development (whether in agricultural research stations, start-ups, or corporations), commercialization, marketing, extension, and the demand side of farmers and beyond?
3. Understanding the technology adoption and diffusion processes that bring innovations into commercial practice:
   • What determines the adoption and dis-adoption of different technologies? What are potential patterns of spatial and social diffusion?
   • What are the mechanisms by which technologies are introduced to farmers, whether through extension and private channels? And how effective are they?
   • How are consumer preferences, public perceptions, and private food industry standards and practices influencing technology adoption upstream by farmers?
   • To what extent is technological diffusion affected by the growing prevalence of contractual relationships in agriculture?
   • What are the drivers and barriers of international agricultural technology diffusion?
   • How does adoption of technologies in foreign markets affect U.S. technology providers as well as U.S. farmers?
4. Evaluating the impacts of research and innovation along multiple dimensions:
   • How do we characterize and measure productivity changes? How do we account for non-market or public goods & bads in productivity measures? How important are these aspects and other omissions from the widely used productivity measures?
   • How are new information technologies and data systems likely to change agricultural value chains? What is the value and ownership structure of emerging data? What is their effect on integration of agricultural value chains?
   • How much does research contribute to rural development and increase the wellbeing of rural America?
   • Who are the winners and losers that result when an innovation is introduced? How are those losses absorbed? How might the incidence of losses generate opposition, economically or politically?
   • How do we understand, measure, and value the impact of new technologies on sustainability and resilience of resources on which agriculture depends?
   • What are the interacting effects of productivity change and climate change on global food security? What are potential carbon policy impacts on agricultural and food systems? What are potential changes in energy production and energy use by agriculture?

These four broad areas of stakeholder demand are intimately interconnected. The diversity of questions across all four share many important themes involving production, markets, the environment, health, and security. Crucially, many stakeholders understand the importance of taking a long-term, integrative, dynamic view of these interrelationships.

The first broad area, on adaptive response, emphasizes those interconnections. A unifying factor is the recognition that agricultural research and innovation play a central role in addressing emerging issues by developing and delivering new technologies that adapt the system of agriculture to meet stakeholder needs. Much applied agricultural R&D is maintenance or adaptive research, for which it is crucial to understand the Red Queen effect, the need for a (crop or livestock) species to be perpetually adapting and evolving, because competing organisms (such as pests and pathogens) do not cease evolving. This effect is accentuated and accelerated by environmental changes, including land use, water availability, climate, biodiversity, etc. Thus, R&D must run faster and faster for the industry just to stay in place. Similarly, R&D initiatives arise in response to temporary or permanent loss of access to input supplies or to important markets—whether due to trade, travel, or immigration disruptions—to develop technologies that increase flexibility in logistics and trading relationships, re-deploying disrupted commercial links, or substituting inputs, enabling the rapid response of value chain structure to mitigate or accommodate the effects of such disruptions on stakeholders. Thus, NC1034 research pays particular attention to the needs, conditions, or factors that induce innovation, and in turn how the resulting innovations causes or enables agriculture to adapt to meet those stakeholder needs. Such feedback or interdependencies are understood to be facilitated both by markets and by public policies. Yet, it is not necessarily a rapid process. It is recognized by stakeholders that there can be long time lags of many years from when research needs are recognized and research funding begins, to when new technologies are first available to farmers. The process of adoption itself can take considerable time and adopted technologies may continue to be used, having impacts on productivity and the environment, for decades. For this reason, changes in R&D are understood to have very long-cycle effects on productivity and economic wellbeing.

Some stakeholders might not realize they cannot take the future availability of a stream of new technologies as a given. Thus, the second broad set of issues is to understand how socio-economic factors affect the R&D institutions and processes that largely account for the supply of innovations and how evolving factors in society change public support for creating and making those technologies available to producers. NC1034 research serves this stakeholder interest by examining how public and private research systems identify demands for and engage in the R&D processes that drive innovation.

The contributions of agricultural research depend not only on the amount of funding, but also on the sources and mechanisms of funding and the organization of the research process. Dramatic changes have been made to the organization and funding of agricultural research that pose challenges and present opportunities. Over the last three decades, the total amount of public funding for agricultural R&D has been shrinking in real terms. The share of state agricultural experiment station (SAES) research funded by state governments has declined, relative to the shares funded by the USDA, other federal agencies and the private sector. This led to the recent development of multi-institute research partnerships between universities, federal labs, and private industries, particularly in the areas of biotechnology and biofuels R&D. The structure and performance of such collaborations merit serious research investigation to inform public policy debates about public-private research partnerships.

In addition to domestic R&D systems in the United States, NC1034 is also concerned with the organization and efficacy of international research and technology transfer in agriculture. This includes the role of traditional public sector sources of research funding and technology transfer such as the World Bank, the CGIAR, and USAID, as well as private foundations such as the Rockefeller Foundation and the Bill and Melinda Gates Foundation. The NC1034 project also increasingly considers the role of private sector R&D around the world, and how competing private interests may shape incentives to innovate or may directly invest new resources in R&D for agriculture.

Stakeholders recognize that simply creating a better mouse trap is not enough. Thus, the third broad issue that stakeholders need to consider is how economic incentives and public policies facilitate or hinder technology adoption and thus the diffusion of those technologies across the economy. The returns to farmers to adopt a new agricultural innovation can be exceedingly different across a range of farm characteristics, and understanding how environmental, economic, and social characteristics influence uptake is key to interpreting and predicting the diffusion of new innovations.  Another critical issue influencing adoption is market acceptance of new technologies, such as seen with biotechnologies. Increasingly, farmers are expected and required to take into account societal attitudes toward their production practices, food industry production guidelines and product standards, and effects of voluntary and mandatory labeling requirements. The NC1034 project examines the direct effects of public perceptions and food industry standards toward farm and food technologies on agricultural producers and consumers as well as the incentives and disincentives they create for technology development and dissemination.

The fourth broad issue important to stakeholders is impact. Foremost this depends upon reliable measurement of the contribution of agricultural innovations to agricultural productivity. Growth of agricultural productivity is necessary to continue to feed the world’s growing population and at the same time conserve increasingly scarce natural resources and adapt to ever more challenging production environments. Productivity is a measure of the amount of agricultural production obtained from a given amount of land, water, and other inputs. It thus directly relates to the amount of resources required to achieve a given amount of production. Productivity growth is thus a fundamental requirement to meet demands for food, fiber, and biofuels without placing undue pressure on land, water, and environmental resources. Key policy questions are: (a) Is productivity growth slowing down and contributing to rising global food prices; (b) what environmental factors are altering rates of productivity growth; and (c) is productivity growth on pace to provide for future global food security? This relates directly to the environmental impacts of agricultural production. Increasingly producer groups are being asked to document their resource “footprints” (e.g. carbon footprint, water footprint) to meet consumer and processor demands for more sustainable production practices.

Finally, stakeholders need common data resources to understand these complex processes. Data on research, adoption, and productivity changes were more readily available when government played a larger role. Increasingly agricultural R&D is carried out by the private sector, and data on private R&D activity and outcomes is often proprietary. Thus, considerable research, data collection, and partnership development is needed to measure the intensity of private sector innovation and its impacts. This requires finding, creating, and collecting data and tracking changes in R&D spending, patenting and licensing, and product testing. Tracking public and private innovation activity (combined with an empirical understanding of the links between them) is critical to assessing whether future productivity will be sufficient to meet future demands while at the same time adapting to increasing sustainability challenges, whether in the form of new pests, new weather patterns, or new market demands.

 

What is the importance of the work and what would be the consequences if it were not done?

Virtually all of the analyses of agricultural R&D conducted worldwide are based on methods developed by current or past participants of the NC1034 community (or its predecessor committees). NC1034 participants have conducted pioneering work in

• agricultural productivity measurement;
• estimation of the returns to agricultural research;
• assessment of the incidence of the payoff to agricultural research (the insight being that how and when an innovator captures a benefit from what they created can matter just as much if not more than the size of the benefit they capture);
• the determinants and effects of adoption of new agricultural technologies, particularly of biotechnologies and precision agricultural technologies;
• implications of changes in intellectual property rights for U.S. agriculture;
• improved design of biotechnology regulations;
• design of processes for research evaluation, priority-setting, and management;
• design and evaluation of research funding mechanisms and processes; and
• evaluation of the impacts of environmental factors, including various aspects of climate change, on agricultural productivity.

Through such work, members of NC1034 have developed multidisciplinary knowledge about the performance of the research system that has been communicated to policymakers, scientists, farmers, and the public through multiple channels. Publications of group members have been widely cited in policy documents and reports, and NC1034 members regularly serve as committee members for policy advisory groups—such as National Academy of Sciences panels, EPA Science Advisory panels, and IPCC working groups. We regularly respond to requests from federal and state agencies, provide testimony to Congress, and serve as expert witnesses in precedent-setting court cases. Our work is regularly cited in regulatory decisions governing approval and deployment of new agricultural technologies. If the group’s work were not done, some consequences would include:

1. a lack of an objective, data-driven knowledge base to inform public policy debates concerning new agricultural technologies;
2. lack of understanding and appreciation of the contributions to society from agricultural research that benefit both consumers and producers;
3. lack of understanding of barriers to the development and adoption of innovations that drive productivity growth and their consequences;
4. lack of understanding the role of agricultural research in maintaining global food security and U.S. agricultural competitiveness while helping preserve natural resources, landscapes, and environmental quality at home and abroad;
5. Lack of understanding of the full nature of threats to agriculture posed by climate, pest and other evolving factors, along with a lack of knowledge on R&D and technology diffusion strategies to limit those threats.

 

What is the technical feasibility of the research?

NC1034 members have developed robust methods for evaluating agricultural innovation systems and technologies. The group’s record of accomplishment of significant publications speaks to the feasibility of such methods. Methods developed by this group for agricultural research evaluation and priority setting have been adopted by practitioners worldwide and have received awards from the Agricultural and Applied Economics Association and other professional bodies.

The demands being placed on agricultural innovation systems have expanded over time and so have the NC1034 group’s methods. Members drawn upon and share a variety of novel methods, as problems require. These include applications of agricultural economics, industrial organization, intellectual property analysis, climate science, environmental valuation, quantitative modeling, rural sociology, human health and nutrition, and energy economics.

Given unprecedented recent disruptions in agriculture and the plethora of new actors engaged in the agricultural innovation system, NC1034 intends to seek ongoing feedback from various stakeholders on our research findings and continue to adapt research efforts accordingly. This will be initiated by inviting policymakers, industry leaders, venture capital investors, and others to participate in our research workshops. We will then seek out new opportunities to partner with appropriate stakeholders on specific studies.

 

What are the advantages for doing the work as a multi-state effort?

NC1034 participants are either agricultural economists, resource economists, or rural sociologists. Most are also part of multi-disciplinary and multi-state research teams addressing important issues in agricultural technology development, adoption, and impact assessment. As part of those multi-state or multi-disciplinary teams, NC1034 participants take the lead in research problems associated with socio-economic causes and consequences of technological change. NC1034 allows participants to share in developing the latest social science and quantitative analytical methods in evaluating returns to agricultural research and the socio-economic impacts of innovations. Further, NC1034 allows participants to take these new evaluation methods back to their state and regional teams and apply them to local problems of interest. NC1034 allows members to benefit indirectly from knowledge gained directly by other members from multi-disciplinary projects. For example, one NC1034 member may gain valuable knowledge from working on a project with weed scientists or entomologists and then convey that to others. Knowledge is thus shared so that social scientists and agricultural scientists may work more effectively together.

Increasingly, agricultural research grants call for comprehensive evaluations of the socio-economic and environmental effects of new technologies and production practices. By continuing to develop cutting-edge evaluation methods, NC1034 members are better able to leverage grant funding and, most significantly, to make major contributions to large multi-state and multi-disciplinary projects. Furthermore, through publications and outreach, threats and opportunities can be conveyed to private and public decision makers altering R&D choices and improving future productivity plus reducing vulnerability.

Adoption of technologies and their impacts spill over across state and international boundaries. While there is a certain value of studying impacts of new technologies in their local contexts, there is also value in the ability to compare and contrast how new technologies affect agricultural producers in different areas and in the identification of areas that may benefit from potential new technologies. Federal agencies, private industry, environmental groups and commodity groups are interested in evaluations of technology and environmental implications for technology that can be scaled-up to commodity-wide or national scale impacts. Multistate collaboration facilitates comparative analyses.

The multi-state community of scholars also provides opportunities for members to economize and achieve synergies through

• the ability to pool resources and share data;
• avoiding redundancy in research activities;
• increasing specialization in and complementarity in research (e.g., one member may work on one aspect of a general problem, while another researcher works on another);
• transfer of analytical methods across research applications;
• cross-pollination of ideas on factors that influence the demand for and impact of technology; and
• transfer of analysis results revealing threats and opportunities to other applicable areas .

Members pool expertise across different production systems and environmental situations. For example, comprehensive evaluation of herbicide-resistant crop varieties requires knowledge of corn, soybean, and cotton production systems not only in a local situation but also different agronomic regions, while modeling climate change-related considerations requires interactions between people who understand the climate issue now and as it is evolving and those who understand regional production systems. Pooling research expertise can help identify commonalities in new technology development and dissemination, as well as regional or crop-specific differences. Another advantage of multistate collaboration is that it can raise awareness of contributions in other fields of research and facilitate acquaintance with other potential research collaborators.

NC1034 has a long and successful history of working with the USDA Economic Research Service. University based participants in NC1034 have worked closely with ERS economists, and indeed ERS economists are active participants of NC1034. ERS has been instrumental in collecting and developing data to measure public and private agricultural R&D and productivity. NC1034 has been an important forum to discuss research methods related to data development, productivity estimation, and technology assessment. Through these forums, state-of-the- art methods for productivity measurement have undergone peer discussions and review.

Finally, NC1034 offers a unique community for mentoring the next generation of experts in the economics of agricultural productivity and innovation. Graduate students and junior faculty from around the United States benefit greatly from opportunities to present their research and receive detailed feedback from more experienced colleagues in a collegial environment. Senior members of the community are enriched by interacting with younger colleagues who often have greater command of technical details in new areas of innovation. Many of the junior and senior members of the NC1034 community describe it as their intellectual home.

 

What would be the likely impacts from successfully continuing NC1034’s work?

Future contributions will build on previous ones. These contributions will include:

• continued formal and informal communication with stakeholders on these issues through multiple channels;
• policy engagement as evidenced by contributions to National Academy of Sciences panels, EPA Science Advisory Panels, and responses to requests from other federal and state agencies;
• continued contributions to decision-making in the regulation of new technologies in agriculture;
• continued development of multidisciplinary knowledge about the performance of the research system; and
• a continued stream of high-impact publications and other public communications to disseminate and advance that knowledge.

Over the next five years, we envision future research to include studies that:

• continue the tradition of modeling and measuring the consequences of innovation with application not only to conventional agricultural technologies but also to deal with novel aspects of the new generations of genome editing and information technologies;
• develop new models and measures of the implications of the evolving funding structure and management of public agricultural R&D;
• explore the role of innovation in the historical and ongoing structural changes in American agriculture and associated productivity growth;
• develop detailed institutional and quantitative understandings of the causes and consequences of the recent trends in regulation of existing and prospective agricultural technologies
• explore the role of consumer perceptions and demand for genome-edited foods on R&D investment and regulations
• investigate the mechanisms by which technologies are introduced to farmers, both through extension and private channels
• investigate the implications of the growing prevalence of contractual structures in the supply chain for technological diffusion
• explore the impact of venture capital and private equity investment on agricultural R&D
• explore the roles of startups and established firms in innovating new forms of agricultural enterprises, including “vertical farming,” meat substitutes, and cannabis production and marketing.
• valuation of private agricultural input research using new market-based measures and intellectual property information
• explore and analyze models of stewardship and ownership of on-farm data in order to understand their implications for the growth and distribution of productivity gains from precision agriculture data collection
• analyze the impact of adoption of conservation agriculture practices on soil health and resilience and explore the potential of market-based programs to incentivize adoption of conservation practices by agricultural producers
• assess the historical and future effects of climate change on global and US agricultural productivity
• assess R&D needs to address opportunities and potential challenges brought by a changing climate.

Related, Current and Previous Work

Scholars participating in NC1034 and its long history of predecessor projects have made unique and resounding contributions to our understanding of the profound economic and social impacts created by agricultural science, commercial innovation, and technological change in agriculture. Virtually every research proposal funded by the USDA or corporate R&D expenditure must be justified in terms of the contributions that it will make, such as improvements in farm productivity, consumer benefits, or resource savings. The work of NC1034 contributes, both directly and indirectly, to the intellectual and methodological foundations for such considerations. Many of the landmark contributions in this field have been made by current or past members of NC1034, including but not limited to the following:

• Evenson, Robert E., and Yoav Kislev. Agricultural Research and Productivity. Yale Univ. Press, 1975. (cited by 573.)
• Ball, V. Eldon. "Output, input, and productivity measurement in US agriculture 1948–79." American Journal of Agricultural Economics67, no. 3 (1985): 475-486. (cited by 317)
• Alston, Julian M., George W. Norton, and Philip G. Pardey. Science Under Scarcity: Principles and practice for agricultural research evaluation and priority setting. Cornell University Press, 1995. (cited by 2021)
• Huffman, Wallace E., and Robert E. Evenson. Science for Agriculture: A long-term perspective. John Wiley & Sons, 2008. (cited by 860)
• Feder, Gershon, Richard E. Just, and David Zilberman. "Adoption of agricultural innovations in developing countries: A survey." Economic Development and Cultural Change (1985): 255-298. (cited by 4220)
• Sunding, David, and David Zilberman. "The agricultural innovation process: research and technology adoption in a changing agricultural sector." Handbooks in Economics (2001): 207-262. (cited by 962)
• Alston, Julian M., Matthew A. Andersen, Jennifer S. James, and Philip G. Pardey. Persistence Pays: US agricultural productivity growth and the benefits from public R&D spending. Springer Science & Business Media, 2009. (cited by 412)
• Fuglie, Keith O., Sun Ling Wang, and V. Eldon Ball, eds. Productivity Growth in Agriculture: An international perspective. CABI, 2012. (cited by 170)

Review of NIMSS data suggests there is very little duplication of NC1034 research activities. NC1034 research primarily applies two fields of social science—economics and sociology—to questions regarding the management of research and its impacts on the agricultural economy, on society, and on the environment. According to our search of the NIMSS database, we find only two recent multi-state projects with related activities:

• NC1100: Land Grant University Innovation Diffusion Enhancement. That project’s duration was October 2015 to September 2020, but its number of participants was limited and it is not clear that it will be renewed in the same topic area. The project focused on specific new technologies from Land Grant Universities and outputs have been primarily extension / outreach type reports and webinars. Given that that project included just a handful of investigators, at Michigan State, Kansas State, and UC Davis, there may be the possibility of collaborative and complementary work with NC1034 members building upon the contributions of NC1100.
• NE1749: Enhancing Rural Economic Opportunities, Community Resilience, and Entrepreneurship. That project’s duration is 2017-2022, and its research is centered on evaluation of rural communities, with occasional consideration of economic and especially entrepreneurial opportunities that may be influenced by agricultural research or extension activities. However, the scope of rural communities is much narrower than what NC1034 affiliated research tends to consider. Still, participants in NC1034 do already actively collaborate with colleagues in NC1749 and additional opportunities for collaborations or complementary work may arise.

NC1034 members are highly productive scholars, publishing altogether over 500 peer-reviewed journal articles since the inception of the current project in 2016. In addition, they have made numerous contributions to edited volumes and government reports. They have also been active in several collaborative research and publishing efforts. For example, NC-1034 members have contributed: (a) several chapters to a volume by the prestigious National Bureau of Economic Research (NBER) on Economics of Research and Innovation in Agriculture, edited by Petra Moser and published by University of Chicago Press, (b) co-editorship and chapters for a volume on California Agriculture Dimensions and Issues, and (c) co-editorship and submissions to a special issue of the journal Sustainability on “Accelerating Bioeconomy Growth through Applied Research and Policy Change,” co-edited by Wesseler and Zilberman.

NC1034 members at the USDA Economic Research Service and at Land Grant Universities have benefitted from their mutual engagement in the project. ERS economists responsible for construction and integration of national and state-level productivity accounts are NC-1034 participants, while academic NC1034 participants have made important contributions (see Ball & Norton, 2012) and have advised USDa regarding advances and improvements in the official productivity data (Shumway et al, 2015). In the latest project period, since 2016, NC1034 members at the USDA ERS and universities have established several cooperative research agreements, including one with Iowa State University on R&D and agricultural productivity growth in the United States, one with University of Arizona on the economics of plant disease control research, and one with Colorado State University on venture capital funded agricultural innovation.

Five of the NC1034 members are research fellows (and the director) of the International Science & Technology Practice & Policy (InSTePP) program that brings together scholars at the University of Minnesota and elsewhere to engage in economic research on science and technology practice and policy, emphasizing the international implications.

Objectives

1. Improve measures of agricultural productivity growth, its impacts on producers and consumers, and its impacts on the environment and natural resources, incorporating concepts of sustainability or regeneration.
   
2. Document and explain changes in agricultural research funding by governments and companies in high income and emerging economies as well as the causes and potential consequences of those changes.
   
3. Explain the benefits and risks of different types of public-private R&D linkages and technology transfer mechanisms for different technological and market contexts.
   
4. Explain the influence of society’s perceptions and consumers’ demand on the adoption of new technologies in agriculture and food, as well as on decisions to invest in R&D of those technologies.
   
5. Characterize and quantify the impacts of changing climate and environment on agricultural productivity and risk and analyze how technological innovations help agriculture to adapt to such changes as well as to decarbonize the economy.
   
6. Investigate the causes, impacts, and dimensions of digitization of agricultural production and supply chains and the influence of data and information technologies on management, productivity, and the structure of the industry.
   
7. Forecast the implications of emerging novel agricultural and food technologies (such as vertical agriculture, cultured meat products, robotics and machine learning, etc) and how they are influenced by changes in population, lifestyles, climate, resources, and new technological opportunities.
   
8. For each of the preceding objectives, raise awareness among key decision makers, stakeholders, and the public about the issues, provide evidence about causes and consequences, and inform choices for action and intervention
   

Methods

Methods to Achieve Objective 1 (Improve measures of agricultural productivity growth, its impacts on producers and consumers, and its impacts on the environment and natural resources, incorporating concepts of sustainability or regeneration.)

Research will continue to refine measurement of agricultural productivity, which measures how much output one can obtain from a given quantity of inputs, or conversely, the resource requirements to generate a given quantity of output. Measuring productivity accurately is a non-trivial issue, as one must determine how to measure changes in the quality of inputs, which often results when new technologies or genetic varieties are introduced.

Scholars participating in NC1034 (and its predecessor projects) from both the ERS and from academia play a central role in developing, improving, and implementing methods to make such measurements. The USDA Economic Research Service (ERS) is responsible for constructing the agricultural productivity accounts for US agriculture. These accounts generate the official estimates of productivity in the U.S. farm sector. They include estimates of outputs, inputs, and total factor productivity (TFP), the preferred measure of agriculture’s contribution to innovation in the U.S. economy overall (Schramm et al. 2008). ERS updates the U.S. agricultural productivity data every two years and posts the data online with detailed documentation. To communicate with a general, non-technical audience, they publish major findings on the ERS website data page as well as in an article in Amber Waves (the magazine published by ERS).

NC1034 participants will be engaged in developing updated measures of international and U.S. state-level productivity. There are several challenges to be overcome.

First, in the absence of reliable farm labor data USDA-ERS researchers have had to develop new approaches and data sources to measure quality-adjusted state-level labor indices so that important state-level U.S. agricultural productivity accounts could continue to enable high quality research on the economics of U.S. agriculture for public and private decision making. Ongoing advances in labor-saving technologies, including precision agriculture, with advanced sensors, artificial intelligence, and autonomous machinery, continue to influence measures of the labor input to agriculture.

An increasingly important area of methodological development is accounting for environmental impacts and natural resource input use in productivity accounts as well as evaluation of methods for estimating "water footprints", "carbon footprints", and other environmental indicators for agricultural production. The longer run relationship between the outputs and the natural resource inputs of agriculture are central to concepts of “conservation,” “sustainable,” and “regenerative” agriculture. As private initiatives to meet market demand for sustainably grown agricultural products continue, and even more so as policies are developed to incentivize farmers to improve environmental quality, provide ecosystem services, or mitigate and sequester greenhouse gasses, high quality productivity measures will be required that accurately account for these environmental factors of production across time and space.

Finally, there is concern over the rate at which U.S. and global agricultural productivity will continue to grow, with increasing evidence that agricultural productivity growth is slowing. This leads to policy questions of what has accounts for this slowdown. And a fundamental question is how climate change may be contributing. Productivity growth has implications for U.S. agricultural exports, world commodity prices, and food security. Productivity accounts for a rising share of the increase in agricultural production, easing pressure on natural resources to supply the rising demand for food.

New econometric methods will be combined with conventional and improved measures of agricultural inputs and outputs and the climate to improve assessments of productivity trends. Analysis of climate change impacts on agricultural productivity will couple econometric analysis of total factor productivity growth and counterfactual climate scenarios derived from climate models, also known as General Circulation Models (GCMs). The analysis econometric analysis will typically link total factor productivity growth with weather fluctuations to capture the underlying responsiveness of the agricultural sector to climatic factors. This empirical relationship will be extensively validated by considering a wide range of model specifications. The counterfactual climatic conditions obtained from the GCMs allow us to derive estimates of the historical impact of climate change on agricultural productivity.

Methods to Achieve Objective 2 (Document and explain changes in agricultural research funding by governments and companies in high income and emerging economies as well as the causes and potential consequences of those changes.)

Differences in public and private agricultural research funding across geographic locations and over time are associated with different explanatory factors using econometric estimation techniques. For public spending, this includes differences across states within the United States as well as across countries. Determinants of private R&D expenditures, patenting, and varietal field trials are estimated using similar methods. Further, data on public and private R&D efforts are compared with productivity data to estimate how changes in R&D activity over space and time affects trends in agricultural productivity growth. Implications for food prices and food security can then be assessed. Thus, research examines the linkages from underlying factors, to agricultural R&D investment, to productivity growth, and ultimately to food security. Returns to research are evaluated using a broader set of metrics than just agricultural production. The influence on other outcomes such as nutrition, health, climate, and the environment are likewise measured and assessed.

One line of work (incl. Colorado State, UC-Berkeley, Clemson, USDA-ERS) will examine the increasing role of venture capital investments in private agricultural R&D and factors that explain these growing private investments.

Methods to Achieve Objective 3 (Explain the benefits and risks of different types of public-private R&D linkages and technology transfer mechanisms for different technological and market contexts.)

Changes in public research have impacts on private R&D just as changes in private R&D have impacts on public research. Ongoing research seeks to quantify the impacts of public research on aggregate private R&D and examine the potential complementary or substitute relationships between these major sources of R&D.

While intellectual property protection is vital for generating private incentives for innovation, there are also benefits from allowing researchers access to information and technologies. Ongoing research assesses such trade-offs. Specific projects (Colorado State, University of Illinois) include analysis of patenting by universities in gene-editing along with licensing mechanisms to allow access to gene editing for specific applications in agriculture.

Methods to achieve Objective 4 (Explain the influence of society’s perceptions and consumers’ demand on the adoption of new technologies in agriculture and food, as well as on decisions to invest in R&D of those technologies.)

Discrete choice experiments (SDSU, UC-Davis) are used to estimate consumer preferences and willingness to pay for new and emerging technologies such as gene-edited foods in the food sector and assess its implications on producers’ adoption of technologies and practices.

Several projects (UC-Davis, Minnesota, Virginia Tech) involve measuring the returns to genetic improvements of crops and livestock using conventional breeding methods as well as modern biotechnology, taking into account both the technological and scientific possibilities, farming realities, and market acceptance constraints. This involves combining various methods including farm production budgets, commodity market models, and consumer and producer attitude surveys and experiments.

Econometric modeling is used to understand the various determinants of agricultural producers’ adoption of technologies such as genetically modified crops, gene-edited crops, precision agriculture technologies, and conservation agriculture practices. An interdisciplinary approach and statistical learning techniques are used to assess the link between producers' adoption of conservation agriculture practices, soil health, and crop yield stability. This is a precursor to developing policies and programs that internalize the public good aspects of conservation agriculture practices and provide market-based solutions to scale up the adoption of agricultural practices and technologies that mitigate the adverse environmental impacts of intensive agriculture production.

Methods to achieve Objective 5 (Characterize and quantify the impacts of changing climate and environment on agricultural productivity and risk and analyze how technological innovations help agriculture to adapt to such changes as well as to decarbonize the economy.)

The analysis of climate change impacts on agricultural productivity (Cornell) couples econometric analysis of agricultural productivity growth with climate scenarios derived from climate General Circulation Models (GCMs). The econometric analysis will typically link productivity growth with weather fluctuations to capture the underlying responsiveness of the agricultural sector to climatic factors. This empirical relationship is validated by considering a range of model specifications. Counterfactual climatic conditions from the GCMs allow consideration of what weather conditions would have been without anthropogenic climate change, to derive the historical impact of anthropogenic climate change on agriculture.

Statistical models are used to see how climate factors and carbon dioxide incidence is affecting agricultural productivity. Research (Texas A&M) is evaluating effect on yields of 18 crops plus milk, feedlot finishing weight, calving rates, and calf survival.  Possible adaptations including irrigation, land use change, crop mix alteration, livestock mix and livestock stocking rate are being evaluated. These studies seek to develop marginal effects of climate on yields and the mitigating effects of adaptations, and generally find critical thresholds above which productivity declines. Additionally, optimization based sector modeling is used to evaluate the cost of effects, the effectiveness of adaptation, and how much needs to be paid to get agriculture and forestry engaged in GHG mitigation. For this, simulations are used for acreage allocation, animal numbers and market price effects.

Finally, the technique of welfare analysis together with dynamic models of adoption (UC-Berkeley), as well as spread of disease and climate shock, are used to assess how new technologies (such as new varieties, precision farming, new practices) reduce the negative effects of expected changes, and how economic impacts are divided among technology manufacturers, producers, and consumers. Research can also assess the impact of alternative regulations on the adoption of technologies and the implication of regulatory-induced delays in adoption. This will expand the framework that developed by Wesseler and Zilberman (2014) and Alston et al (2010).

Methods to achieve Objective 6 (Investigate the causes, impacts, and dimensions of digitization of agricultural production and supply chains and the influence of data and information technologies on management, productivity, and the structure of the industry.)

Welfare analysis is simiilarly used (as in Objective 5) to assess the distributional impact of new precision farming technologies on agriculture and the environment, that is how the economic impact of the technology’s adoption is divided among technology manufacturers, producers, consumers, and the environment, again expanding on the framework developed by Wesseler and Zilberman (2014) and Alston et al (2010).

One line of research (U of Illinois) analyzes the role of cooperative data ownership in the Dairy Herd Improvement program for the development of the dairy sector as well as how such information affects technology adoption and farm management decisions. Emphasis is given to both the private and public benefits that cooperative data systems provide. This research is complemented by analyzing current trends in adoption of genetics on dairies, and what role disseminating information through cooperative data ownership plays in farmer decisions.

Methods to achieve Objective 7 (Forecast the implications of emerging novel agricultural and food technologies (such as vertical agriculture, cultured meat products, robotics and machine learning, etc) and how they are influenced by changes in population, lifestyles, climate, resources, and new technological opportunities.)

Econometric, simulation and other methods will be employed to estimate the influence of environmental factors on differences across space in time in agricultural productivity levels, variability and growth. This includes differences across states, crops and animal products within the United States as well as cross-country differences. In addition, economic appraisal of a continuation of current trends plus the influence of alternative adaptation and mitigation actions will be undertaken particularly related to climate change. This will involve methods development, application, and dissemination. Work will also be done on program design to facilitate private adoption and, where needed, public roles in adaptation and mitigation.

Analysis will draw on detailled data on technologies being devleoped by private companies with venture capital funding (developed by Colorado State and USDA-ERS) to quantify the emergence of novel agricultural and food technologies and factors associated with their funding and development.

Measurement of Progress and Results

Outputs

• New data sets measuring quantities of agricultural inputs, outputs, and productivity
• New data sets measuring public and private research investments, patenting, and other inventive activity
• Results from analysis of data to estimate factors determining inventive activity
• Results from analysis of data to estimate the effect of agricultural R&D on productivity
• Results from analysis of data to estimate the effect of climate on productivity
• Results from analysis of data to estimate economic returns to investments in agricultural R&D and extension
• Published research will assess the economic and social impacts of new technologies, including biotechnology, bioenergy, information technologies, and natural resource conserving technologies
• Published research will assess the productivity, economic, environmental, and social impacts of drought, weather extremes and climate change, in addition to prospects and program design for adaptation and mitigation

Outcomes or Projected Impacts

• The project will provide analysts and research program planners throughout the United States and worldwide with improved methods to evaluate impacts of technological change and to conduct economic evaluations of alternative research policy options. Research administrators will be provided with improved methods to analyze data and information and to make recommendations to decision-makers.
• Outputs of the project will be used to enhance knowledge and awareness among state agricultural experiment station directors, NIFA, and groups that influence the allocation of public research and extension dollars, of the impacts of changes in research and extension funding levels and funding mechanisms.
• Project participants will continue to contribute to projects and publications of The Board on Agriculture and Natural Resources (BANR). BANR is the major program unit of the National Research Council (NRC) responsible for organizing and overseeing studies on issues of agricultural production and related matters of natural resource development, including forestry, fisheries, wildlife, and land and water use. The goal of the NRC, organized by the National Academy of Sciences, is to further knowledge and advise the federal government on critical issues in science and technology. Project participants will continue to be directly involved in publications and to be sources of key cited references.
• Organizations furthering international agricultural research and technology transfer such as the CGIAR Consortium, the World Bank, USDA, and the U.S. Agency for International Development will use research findings and research evaluation methods developed by project participants.
• Information will be created for the global community on the influences of climate change on productivity as an input to climate related decisions with materials fed into US assessments and UNFCCC/IPCC assessments.

Milestones

(2022):1. Organization of the NC1034 annual research symposium, 2. Organization of and participation in sessions of the annual meeting of the Agricultural & Applied Economics Association (https://www.aaea.org/meetings), 3. Organization of and participation in sessions of the International Consortium on Applied Bioeconomy Research annual conference (https://icabr.net/).

(2023):1. Organization of the NC1034 annual research symposium, 2. Organization of and participation in sessions of the annual meeting of the Agricultural & Applied Economics Association (https://www.aaea.org/meetings), 3. Organization of and participation in sessions of the International Consortium on Applied Bioeconomy Research annual conference (https://icabr.net/).

(2024):1. Organization of the NC1034 annual research symposium, 2. Organization of and participation in sessions of the annual meeting of the Agricultural & Applied Economics Association (https://www.aaea.org/meetings), 3. Organization of and participation in sessions of the International Consortium on Applied Bioeconomy Research annual conference (https://icabr.net/).

(2025):1. Organization of the NC1034 annual research symposium, 2. Organization of and participation in sessions of the annual meeting of the Agricultural & Applied Economics Association (https://www.aaea.org/meetings), 3. Organization of and participation in sessions of the International Consortium on Applied Bioeconomy Research annual conference (https://icabr.net/).

(2026):1. Organization of the NC1034 annual research symposium, 2. Organization of and participation in sessions of the annual meeting of the Agricultural & Applied Economics Association (https://www.aaea.org/meetings), 3. Organization of and participation in sessions of the International Consortium on Applied Bioeconomy Research annual conference (https://icabr.net/).

Projected Participation

View Appendix E: Participation

Outreach Plan

This project places a premium on communicating and disseminating research results to Experiment Station Directors, Deans of Colleges of Agriculture, national research administrators, and national policymakers and research directors responsible for justifying and allocating resources to research in agriculture and natural resources.

Participants provide background assessments, materials based on project experience, research findings, and expert input across all three branches of the federal government:

• Department of Justice periodically engages participants in NC1034 for background information concerning the potential impact of mergers and acquisitions of agricultural companies on agricultural innovation. It is expected that participants will continue providing background materials and assessments as requested in support of such evaluation efforts.
• Participants advise U.S. Environmental Protection Agency on climate change impacts on agricultural productivity. Participants have served and will continue to serve as reviewers on federal scientific reports on climate change, including the USDA, USEPA, USDOE, the Intergovernmental Panel on Climate Change (IPCC), and the congressionally mandated National Climate Assessment.
• Participants work with U.S. Patent and Trademark Office, in the Department of Commerce, on intellectual property policy and effects on innovation in agriculture.
• Project findings have been cited in Congressional Research Service reports to Congress and project members regularly provide direct testimony before state and federal legislative bodies.
• Participants regularly provide talking points based on project to LGU deans and experiment station directors in support of their testimony before Congressional agricultural and natural resource committees
• Participants contribute to authoring/filing Amicus Briefs for cases before the United States Supreme Court
• Participants have served as expert witness in a range of federal cases involving agricultural industry, technology, and intellectual property disputes.

There is an active exchange of information, data and expertise between ERS economists and other NC1034 members, beneficial to both. ERS forums, publications and briefings are a critical means of bringing NC1034 research findings to the attention of policymakers in timely and accessible formats. Close collaboration with ERS economists will continue throughout the next phase of the project.

Participants also work with agricultural policy and commodity groups such as the Farm Bureau, Cotton Incorporated, and United Soybean Board to develop materials based on project research. Examples include providing supporting research and developing infographics about the economic benefits of herbicide resistance management, water conservation, and integrated pest management. Participants are also regular speakers at workshops organized by the Farm Foundation and contribute to the Foundation’s Issue Reports on topics such as returns to public investment in research and extension, university-industry relations in biotechnology research, and climate change mitigation and adaptation. 

Participants will continue to actively engage with international organizations:

• the CGIAR system, with follow up to a recent meta-review of the returns to research conducted by the CG centers
• the OECD Network on Agricultural Total Factor Productivity and the Environment
• the OECD Co-operative Research Programme on Biological Resource Management for Sustainable Agricultural Systems
• the Asia-Pacific Innovation Conference
• the World Intellectual Property Organization (WIPO)

A primary channel for communication of the results of NC1034 research will continue to be peer-reviewed journal articles and book chapters. As indicated above, between 2016 and 2020 participants in NC1034 produced over 500 such publications, including select publications in high circulation scientific journals such as Science, Nature, Nature Biotechnology, and the PLOS journals. We expect the output to continue at a similar rates and impact factors over the next phase of the project.

A key means of outreach is publication of research results in more accessible outreach publications:

• Project participants frequently publish project findings in the magazine Choices, the principal outreach vehicle of the Agricultural and Applied Economics Association (AAEA).
• articipants have also coordinated publications in the online journal AgBioForum, which is “committed to providing a space where academics, private and public sector analysts, and decision makers can present timely scientific evidence to enrich the ongoing public debate regarding the economic and social impacts of agricultural biotechnology.” AgBioForum is financed by the Illinois Missouri Biotechnology Alliance (IMBA). IMBA is supported by a Congressional Special Grant to provide funding for university biotechnology research.
• esearch findings have been and will continue to be published in a variety of outreach publications and online extension series of land grant universities. These include, for example, the University of California’s Agricultural Issues Center Briefs, ARE Update, and California Agriculture, the Center for Agricultural and Rural Development’s Iowa Ag Review, University of Illinois’ FarmDoc project, South Dakota State University’s online extension platform, and Colorado State University’s online extension Fact Sheets.

Results of the project will be integrated into Cooperative Extension in a number of ways. First, participants are conducting research projects measuring the economic returns to specific Cooperative Extension programs. These include extension programs for water conservation, energy conservation, rangeland management, seed potato certification, and integrated pest management. The value of extension programs will be communicated to state legislators and other decision makers through Cooperative Extension publications, testimony, briefings and press releases. Ongoing project research has also estimated the contribution of extension funding on state-level productivity growth.

To keep up with new developments in social media, participants are increasingly making project findings accessible via university press releases and websites, development of infographics (often in collaboration with industry groups), guest articles in farm organization newsletters, blogs, and Cooperative Extension webinars.

Organization/Governance

The project will be organized as a Multi-state Research Project consistent with the specifications for membership and organization given in the Guidelines for Multi-state Research Activities. The project technical committee shall consist of one vote from each cooperating agency as appointed or otherwise designated by each respective organization, an administrative advisor appointed by the Association of North Central Experiment Station Directors and a representative of the National Institute of Food and Agriculture (NIFA). 

The executive committee for NC-1034 shall consist of a chairman and secretary, elected by the technical committee. Members of the executive committee will be elected annually and may succeed themselves. This committee will have the major responsibility for coordinating annual research symposia contributing to the Multi-state Research Project.

The chairman of the project technical committee will prepare the annual report, summarized from material supplies to him by the project committee member from each participating agency. The chairman will send two copies of the final draft of the annual report with original signature of recommendation and an approval block for signature to the Administrative Advisor. The Administrative Advisor will make the appropriate distribution.

Meetings will be held at least once a year at time and place mutually agreed upon by the technical committee with the approval of the administrative advisor. The secretary will have responsibility to record the minutes of the annual meeting. The secretary will be responsible for distribution of approved minutes to members of the technical committee. The Administrative Advisor will send approved copies to NIFA and Directors of participating SAES and other agencies. A research symposium, drawing on the work of individuals inside and outside the project, will normally be held in conjunction with the annual meeting.

Literature Cited

Alston, Julian M., Andersen, Matthew A., James, Jennifer S., & Pardey, Philip G. 2010. Persistence Pays: US Agricultural Productivity Growth and the Benefits from Public R&D Spending. Springer Science & Business Media.

Alston, Julian M., George W. Norton, and Philip G. Pardey. 1985. Science Under Scarcity: Principles and practice for agricultural research evaluation and priority setting. Cornell University Press.

Alston, Julian M., Philip G. Pardey and Xudong Rao. 2020. The Payoff to Investing in CGIAR Research. Washington DC: SoAR Foundation.

Alston, J. M., Norton, G. W., & Pardey, P. G. 1995. Science Under Scarcity: Principles and Practice for Agricultural Research Evaluation and Priority Setting. Cornell University Press.

Ball, V. Eldon. 1985. "Output, input, and productivity measurement in US agriculture 1948–79." American Journal of Agricultural Economics 67, no. 3: 475-486.

Ball, V. Eldon and George Norton. 2012. Agricultural Productivity: Measurement and Sources of Growth. Springer Science & Business Media.

Evenson, Robert E., and Yoav Kislev. 1975. Agricultural Research and Productivity. Yale Univ. Press.

Feder, Gershon, Richard E. Just, and David Zilberman. 1985. "Adoption of agricultural innovations in developing countries: A survey." Economic Development and Cultural Change 33.2: 255-298.

Fuglie, K. O., Wang, S. L., & Ball, V. E. (eds.) 2012. Productivity growth in agriculture: an international perspective. Cambridge, MA: CABI.

Huffman, Wallace E., and Robert E. Evenson. 2008. Science for Agriculture: A long-term perspective. John Wiley & Sons.

Schramm, C., and 14 others. 2008. Innovation Measurement: Tracking the State of Innovation in the American Economy. A Report to the Secretary of Commerce by the Advisory Committee on Measuring Innovation in the 21st Century Economy.

Shumway, C. Richard, Barbara M. Fraumeni, Lilyan E. Fulginiti, Jon D. Samuels, and Spiro E. Stefanou. 2015. Measurement of U.S. Agricultural Productivity: A 2014 Review of Current Statistics and Proposals for Change. Report of the Review Committee for USDA Productivity Accounts, Working Paper Series WP 2015-12, School of Economic Sciences, Washington State University.

Sunding, David, and David Zilberman. 2001. "The agricultural innovation process: research and technology adoption in a changing agricultural sector." Handbooks in Economics 18.1A: 207-262.

Wesseler, Justus, and David Zilberman. 2014 "The economic power of the Golden Rice opposition." Environment and Development Economics 19, no. 6: 724-742.

Attachments

Land Grant Participating States/Institutions

AL, AZ, CA, CO, FL, GA, IA, IL, IN, KY, MN, MT, ND, NE, NJ, NY, OK, PA, SC, TX, VA, WA, WI, WY

Non Land Grant Participating States/Institutions

USDA/ERS